Who Is Responsible for Care Home Fees in the UK?
The legal responsibility for paying for care home fees lies with the individual receiving care, not their children or other family members. Your assets and finances are separate and should not be included in any financial assessment of your parent. The only time a family member becomes liable is if they have voluntarily entered into a legal agreement or contract with the care provider to pay the fees, such as a top-up fee agreement. It is therefore crucial to understand the legal and financial landscape before signing any documents.
The Care Needs Assessment: The First Step
Before any financial decisions are made, your parent must undergo a care needs assessment from their local council's Adult Social Care department. This assessment is free and determines whether your parent has eligible care needs that require a care home placement. If the council determines that residential care is the best option, they will then proceed with a financial assessment to calculate how much your parent must contribute.
The Financial Assessment (Means Test)
Following the needs assessment, the local council will conduct a financial assessment (or means test) to determine your parent's ability to pay for care. This assessment looks at their income, such as pensions and benefits, and their capital, which includes savings, investments, and property. In England, the assessment is based on the following capital thresholds:
- Over £23,250 in capital: Your parent is considered a 'self-funder' and must pay the full cost of their care until their capital falls below this limit.
- Between £14,250 and £23,250 in capital: The council provides some financial support. Your parent will contribute from their income and a 'tariff income' based on the capital in this range (£1 for every £250 over £14,250).
- Below £14,250 in capital: The council will provide maximum financial support, with your parent contributing from their income. Their capital is disregarded.
It is important to note that these thresholds vary across different parts of the UK, including Scotland, Wales, and Northern Ireland.
How is income treated?
During the financial assessment, most forms of income are considered, but your parent must be left with a minimum Personal Expenses Allowance (PEA) for their own use. In England, the PEA is currently £30.15 per week. Some disability benefits, particularly the mobility component, are disregarded.
What about a property?
The family home's value is typically included in the financial assessment if the care home stay is permanent. However, it will be disregarded under certain circumstances, such as when it remains the primary residence for:
- A spouse or partner.
- A relative aged 60 or over.
- A relative under 60 who is disabled.
- A child under 18.
If the property is counted, your parent may need to sell it to fund their care. A Deferred Payment Agreement (DPA) offers an alternative, allowing your parent to defer paying care fees using their home as security, with the local council repaying the loan from the parent's estate later.
Potential Funding Support
NHS Continuing Healthcare (CHC)
For those with a primary health need due to severe or complex health issues, NHS Continuing Healthcare (CHC) provides full funding for care home fees. This is not means-tested and requires a separate assessment by the NHS.
NHS-Funded Nursing Care (FNC)
If a parent does not qualify for CHC but requires nursing care in a nursing home, the NHS pays a flat-rate contribution directly to the home, covering the cost of the nursing component of their care.
Third-Party Top-Up Fees
If your parent wants to live in a more expensive care home than the council's personal budget will cover, a third party—usually a family member—can pay the difference. This is called a top-up fee and is a voluntary agreement. The council must show that at least one suitable care home is available at the standard rate.
Deprivation of Assets
It is a serious mistake to think you can simply give away a parent's assets, such as their house, to avoid care fees. This is known as 'deprivation of assets.' If the local council believes assets were deliberately given away to reduce the amount payable for care, they can assess your parent as if they still possessed the asset. There is no strict time limit for this 'look-back' period, and the council will investigate the timing and reasons for the transfer. In some cases, the council can even pursue the person who received the gift for repayment.
Comparison of Funding Scenarios in England
| Your Parent's Capital | Who Pays What? | What to Expect |
|---|---|---|
| Over £23,250 | Your parent pays the full fees (self-funder). | This continues until capital drops to £23,250. Contact the council a few months before this limit is reached to arrange a financial assessment. |
| Between £14,250 and £23,250 | The council provides some funding. Your parent contributes from their income plus a 'tariff income' from their capital. | An extra £1/week is added to their income for every £250 in capital over £14,250. |
| Under £14,250 | The council provides maximum funding. Your parent contributes only from their income, and their capital is disregarded. | The council will ensure your parent is left with the Personal Expenses Allowance. |
Practical Steps to Take
- Start with a Needs Assessment: This is the essential first step to determine your parent's eligibility for care and potential council support.
- Get Financial Advice: Consider seeking independent financial advice, especially if your parents have complex finances or property. The Society of Later Life Advisers (SOLLA) can help you find an accredited financial adviser.
- Plan Ahead: Talk openly with your parents about their finances and preferences for care while they are still able to make decisions. Putting a Lasting Power of Attorney (LPA) in place can be invaluable.
- Do Not Deprive Assets: Avoid attempting to reduce capital by gifting money or property to family, as this can be investigated by the local authority.
For more detailed guidance on care funding, please visit the Age UK information page on paying for a care home.
Conclusion
In summary, the responsibility for care home fees in the UK rests with the individual requiring care. Your legal obligation to pay is non-existent unless you have voluntarily signed a contract to do so. The amount your parent contributes is decided by a financial assessment conducted by their local council, which takes into account their income and capital, including property under certain conditions. Understanding these rules is vital for effective planning and ensuring your parent receives the best possible care.
